us-irs-announcements-irb-2010-21-pdf•Internal Revenue Bulletin 2010-21 (PDF rendition): IRS Announcements
Internal Revenue Bulletin 2010-21 (PDF rendition): IRS Announcements
us-irs-announcements-irb-2010-21-pdfInternal Revenue Bulletin 2010-21 (PDF rendition): IRS AnnouncementsGuidance
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Bulletin No. 201 0-21 May 24, 2010 HIGHLIGHTS OF THIS ISSUE These synopses are intended only as aids to the reader in identifying the subject matter covered. They may not be relied upon as authoritative interpretations. INCOME TAX Rev. Rul. 2010–13, page 691. Section 45R — Average premium for small group mar- ket for determining the small employer health insurance credit.Section 45R provides a federal income tax credit to eligible small employers, including tax-exempt organizations, that make nonelective contributions towards their employees’ health insurance premiums under an arrangement that meets certain requirements. The amount of an employer’s premiums that are taken into consideration for purposes of calculating the credit cannot exceed the average premium for the small group market in the state in which the employer offers cover- age. This ruling publishes the average premium rates for the small group market. These rates are determined by the De- partment of Health and Human Services. EMPLOYEE PLANS Notice 2010–40, page 693. Weighted average interest rate update; corporate bond indices; 30–year Treasury securities; segment rates. This notice contains updates for the corporate bond weighted average interest rate for plan years beginning in May 2010; the 24-month average segment rates; the funding transitional segment rates applicable for May 2010; and the minimum present value transitional rates for April 2010. EXEMPT ORGANIZATIONS Announcement 2010–36, page 696. A list is provided of organizations now classified as private foun- dations. ADMINISTRATIVE Announcement 2010–38, page 696. This document contains a correction to final regulations (T.D. 9350, 2007–2 C.B. 607) that modify the rules relating to the disclosure of reportable transactions under section 6011 of the Code. Finding Lists begin on page ii. The IRS Mission Provide Americ a’s taxpayers top quality service by helping them understand an d meet their tax responsibilities and by applying the tax law with integrity and fairness to all. Introduction The Internal Revenue Bulletin is the authoritative instrument of the Commissioner of Internal Revenue for announcing official rulings and procedures of the Internal Revenue Service and for publishing Treasury Decisions, Executive Orders, Tax Conven- tions, legislation, court decisions, and other items of general interest. It is published weekly and may be obtained from the Superintendent of Documents on a subscription basis. Bulletin contents are compiled semiannually into Cumulative Bulletins, which are sold on a single-copy basis. It is the policy of the Service to publish in the Bulletin all sub- stantive rulings necessary to promote a uniform application of the tax laws, including all rulings that supersede, revoke, mod- ify, or amend any of those previously published in the Bulletin. All published rulings apply retroactively unless otherwise indi- cated. Procedures relating solely to matters of internal man- agement are not published; however, statements of internal practices and procedures that affect the rights and duties of taxpayers are published. Revenue rulings represent the conclusions of the Service on the application of the law to the pivotal facts stated in the revenue ruling. In those based on positions taken in rulings to taxpayers or technical advice to Service field offices, identifying details and information of a confidential nature are deleted to prevent unwarranted invasions of privacy and to comply with statutory requirements. Rulings and procedures reported in the Bulletin do not have the force and effect of Treasury Department Regulations, but they may be used as precedents. Unpublished rulings will not be relied on, used, or cited as precedents by Service personnel in the disposition of other cases. In applying published rulings and procedures, the effect of subsequent legislation, regulations, court decisions, rulings, and procedures must be considered, and Service personnel and others concerned are cautioned against reaching the same conclusions in other cases unless the facts and circumstances are substantially the same. The Bulletin is divided into four parts as follows: Part I.—19 86 Code. This part i ncludes rulings and decisions based on provisions of the Intern al Revenue Code of 1986. Part II.—Treaties and Tax Legislation. This part is divided into two subparts as follows: Subpart A, Tax Conventions and Other Related Items, and Subpart B, Leg- islation and Related Committee Reports. Part III.—Administrative, Procedural, and Miscellaneous. To the extent practicable, pertinent cross references to these subjects are contained in the other Parts and Subparts. Also included in this part are Bank Secrecy Act Administrative Rul- ings. Bank Secrecy Act Administrative Rulings are issued by the Department of the Treasury’s Office of the Assistant Secre- tary (Enforcement). Part IV .—Items of General Interest. This par t includes notices of proposed rulemakings, disbar- ment an d suspension lists, and announcements. The last Bulletin for each month includes a cumulative index for the matters published during the preceding months. These monthly indexes are cumulated on a semiannual basis, and are published in the last Bulletin of each semiannual period. The c ontents of this publication are not copyrighted and may be reprinted freely. A citation of the Internal Revenue Bulletin as the source would be appropriate. For sale by the Superintendent of Documents, U.S.Government Printing Office, Washington, DC 20402. May 24, 20102010–21 I.R.B. Part I. Rulings and Decisions Under the Internal Revenue Code of 1986 Section 45R.— Average Premium for Small Group Market for Determining the Small Employer Health Insurance Credit (Also Section 38(b).) Section 45R — Average premium for small group market for determining the small employer health insurance credit. Section 45R provides a federal income tax credit to eligible small employers, including tax-exempt organizations, that make nonelective contributions towards their employees’ health insurance pre- miums under an arrangement that meets certain requirements. The amount of an employer’s premiums that are taken into consideration for purposes of calculating the credit cannot exceed the average pre- mium for the small group market in the state in which the employer offers cov- erage. This ruling publishes the average premium rates for the small group market. These rates are determined by the Depart- ment of Health and Human Services. Rev. Rul. 2010 –13 Section 45R wa s added to the Internal Revenue Code b ysection1421ofthePa- tient Protect ion and Affordable Care Act (the Afforda bleCareAct),Pub. L.No. 111-148. The Affordable Care Act was signed by the President on March 23, 2010. Section 45R i s effective for taxable years beginning a fter December 31, 2009. Section 45R p rovides a Federal income tax credit t o eligible small employers, including t ax-exempt organizations, that make nonele ctive contributions towards their emplo yees’ health insurance pre- miums unde r an arrangement that meets certain re quirements. For taxable years beginning before 2014, the amount of the credit is based on a percentage of the lesser of: 1) the amount of nonelective contribu tions paid by the eligible small employer on behalf of employees under the arran gement during the taxable year, and 2) the amount of nonelective contribu- tions the employer would have paid under the arra ngement if each such employee were enr olled in a plan that had a pre- mium equ al to the average premium for the small grou pmarketintheState(orin an area in the S tate) in which the employer is offering he alth insurance coverage. The Secretary of Health and Human Services (HHS) determ ines whether separate aver- age premiums will apply for areas within aState(“sub -State areas”) and also deter- mines the av erage premium for a State or sub-State a rea. The chart below sets forth the average premium for the small group market in ea ch State for the 2010 taxable year, as det erminedbyHHS. HHS recogni zes that there may be areas in some Sta tes with meaningfully higher premium ra tes. For the 2010 taxable year, HHS may pro vide additional average pre- mium rates for the small group market in certain ar eas within States. However, in no case wi ll any such additional sub-State rates be l ower than the applicable rate for each Stat e that is set forth in this Revenue Ruling. The follo wing chart sets forth the aver- age premi um for the small group market in each Stat e for the 2010 taxable year. Fam- ily cove rage includes any coverage other than emp loyee-only (or single) coverage. State Employee-only Coverage Family Coverage Alaska $ 6,204$ 13,723 Alabama4,441 11,275 Arkansa s 4,3299,677 Arizona 4,495 10,239 California4,628 10,957 Colora do 4,97211,437 Connecticut 5,419 13,484 District of Columbia 5,355 12,823 Delaw are 5,60212,513 Florida 5,16112,453 Georgia4,612 10,5 98 Hawa ii 4,22 8 10,508 Iowa 4,65210,503 Idaho 4,2 15 9,3 65 Ill inois 5,198 12, 309 Indiana 4,775 11,222 Kansas4,60311,462 Ken tucky 4,2 87 10, 434 Louisiana4,82911,074 Massachusetts 5, 700 14,138 Ma ryland 4, 837 11 ,939 Maine 5,215 11,887 Michigan 5 ,098 12,364 2010–21 I.R.B.691May 24, 2010 Minnesota4,70411,938 Missouri4,66310,681 Mississippi 4,53310,501 Montana4,77210,212 North Carolina4,920 11,583 North Dakota4,469 10,506 Nebraska 4,715 11,169 New Hampshire 5,519 13,624 New Jersey 5,60713,521 New Mexico 4,754 11,404 Nevada 4,553 10,297 New York 5,442 12,867 Ohio4,66711,293 Oklahoma4,83811,002 Oregon4,68110,890 Pennsylvania 5,039 12,471 Rhode Island 5,887 13,786 South Carolina4,89911,780 South Dakota4,49711,483 Tennessee4,61110,369 Texas 5,140 11,972 Utah4,238 10,935 Virginia4,89011,338 Vermont 5,244 11,748 Washington 4,54310,725 Wisconsin 5,222 12,819 West Virginia4,98611,611 Wyoming 5,266 12,163 DRAFTING INFORMATION The principal author of this revenue rul- ing is Mireille Khoury of the Office of the Division Counsel/Associate Chief Coun- sel (Tax Exempt & Government Entities). For further information regarding this rev- enue ruling, contact Mireille Khoury at (202) 622–6080 (not a toll-free call). For questions regarding the data contained in the table of average State premiums, contact Tara Oakman of the Department of Health and Human Services at (202) 690–6870 (not a toll-free call). May 24, 20106922010–21 I.R.B. Part III. Administrative, Procedural, and Miscellaneous Update for Weighted Average Interest Rates, Yield Curves, and Segment Rates Notice 2010–40 This notice provides guidance as to the corporate bond weighted average interest rate and the permissible range of interest rates specified under § 412(b)(5)(B)(ii)(II) of the Internal Revenue Code as in ef- fect for plan years beginning before 2008. It also provides guidance on the corpo- rate bond monthly yield curve (and the corresponding spot segment rates), the 24-month average segment rates, and the funding transitional segment rates under § 430(h)(2). In addition, this no- tice provides guidance as to the interest rate on 30-year Treasury securities un- der § 417(e)(3)(A)(ii)(II) as in effect for plan years beginning before 2008, the 30-year Treasury weighted average rate under § 431(c)(6)(E)(ii)(I), and the min- imum present value segment rates under § 417(e)(3)(D) as in effect for plan years beginning after 2007. CORPORATE BOND WEIGHTED AVERAGE INTEREST RATE Sections412(b)(5)(B)(ii)and 412(l)(7)(C)(i), as amended by the Pen- sion Funding Equity Act of 2004 and by the Pension Protection Act of 2006 (PPA), provide that the interest rates used to cal- culate current liability and to determine the required contribution under § 412(l) for plan years beginning in 2004 through 2007 must be within a permissible range based on the weighted average of the rates of interest on amounts invested conser- vatively in long term investment grade corporate bonds during the 4-year period ending on the last day before the beginning of the plan year. Notice 2004–34, 2004–1 C.B. 848, pro- vides guidelines for determining the cor- porate bond weighted average interest rate and the resulting permissible range of in- terest rates used to calculate current liabil- ity. That notice establishes that the corpo- rate bond weighted average is based on the monthly composite corporate bond rate de- rived from designated corporate bond in- dices. The methodology for determining the monthly composite corporate bond rate as set forth in Notice 2004–34 continues to apply in determining that rate. See Notice 2006–75, 2006–2 C.B. 366. The composite corporate bond rate for April 2010 is 5.84 percent. Pursuant to No- tice 2004–34, the Service has determined this rate as the average of the monthly yields for the included corporate bond in- dices for that month. The following corporate bond weighted average interest rate was determined for plan years beginning in the month shown below. For Plan Years Beginning inPermissible Range MonthYear Corporate Bond Weighted Average90%to100% May20106.37 5.73 6.37 YIELD CURVE AND SEGMENT RATES Generally for plan years beginning after 2007 (except for delayed effective dates for certain plans under sections 104, 105, and 106 of PPA), § 430 of the Code specifies the minimum funding require- ments that apply to single employer plans pursuant to § 412. Section 430(h)(2) spec- ifies the interest rates that must be used to determine a plan’s target normal cost and funding target. Under this provision, present value is generally determined us- ing three 24-month average interest rates (“segment rates”), each of which applies to cash flows during specified periods. However, an election may be made under § 430(h)(2)(D)(ii) to use the monthly yield curve in place of the segment rates. For plan years beginning in 2008 and 2009, a transitional rule under § 430(h)(2)(G) pro- vides that the segment rates are blended with the corporate bond weighted average as specified above. An election may be made under § 430(h)(2)(G)(iv) to use the segment rates without applying the transi- tional rule. Notice 2007–81, 2007–2 C.B. 899, provides guidelines for determining the monthly corporate bond yield curve, the 24-month average corporate bond segment rates, and the funding transitional segment rates used to compute the target normal cost and the funding target. Pursuant to Notice 2007–81, the monthly corporate bond yield curve derived from April 2010 data is in Table I at the end of this notice. The spot first, second, and third segment rates for the month of April 2010 are, respectively, 2.30, 5.60, and 6.47. The three 24-month average corporate bond segment rates applicable for May 2010 under the election of § 430(h)(2)(G)(iv) are as follows: First Segment Second Segment Third Segment 4.26 6.56 6.70 2010–21 I.R.B.693May 24, 2010 The transitional segment rates under § 430(h)(2)(G) applicable for May 2010, taking into account the corporate bond weighted average of 6.37 stated above, are as follows: For Plan Years Beginning in First Segment Second Segment Third Segment 20094.96 6.506.59 The transitional rule of § 430(h)(2)(G) does not apply to plan years starting in 2010. Therefore, for a plan year starting in 2010 with a lookback month to May 2010, the funding segment rates are the three 24-month average corporate bond segment rates applicable for May 2010, listed above without blending for the transitional pe- riod. 30-YEAR TREASURY SECURITIES INTEREST RATES Section 417(e)(3)(A)(ii)(II) (prior to amendment by PPA) defines the appli- cable interest rate, which must be used for purposes of determining the minimum present value of a participant’s benefit under § 417(e)(1) and (2), as the annual rate of interest on 30-year Treasury se- curities for the month before the date of distribution or such other time as the Secretary may by regulations prescribe. Section 1.417(e)–1(d)(3) of the Income Tax Regulations provides that the applica- bleinterestrateforamonthistheannual rate of interest on 30-year Treasury secu- rities as specified by the Commissioner for that month in revenue rulings, notices or other guidance published in the Internal Revenue Bulletin. The rate of interest on 30-year Trea- sury securities for April 2010 is 4.69 per- cent. The Service has determined this rate as the average of the daily determinations of yield on the 30-year Treasury bond ma- turing in February 2040. Generally for plan years beginning after 2007, § 431 specifies the mini- mum funding requirements that apply to multiemployer plans pursuant to § 412. Section 431(c)(6)(B) specifies a minimum amount for the full-funding limitation described in section 431(c)(6)(A), based on the plan’s current liability. Section 431(c)(6)(E)(ii)(I) provides that the inter- est rate used to calculate current liability for this purpose must be no more than 5 percent above and no more than 10 percent below the weighted average of the rates of interest on 30-year Treasury securities dur- ing the four-year period ending on the last day before the beginning of the plan year. Notice 88–73, 1988–2 C.B. 383, provides guidelines for determining the weighted average interest rate. The following rates were determined for plan years beginning in the month shown below. For Plan Years Beginning inPermissible Range MonthYear 30-Year Treasury Weighted Average90%to105% May20104.403.964.62 MINIMUM PRESENT VALUE SEGMENT RATES Generally for plan years beginning af- ter December 31, 2007, the applicable in- terest rates under § 417(e)(3)(D) are seg- ment rates computed without regard to a 24-month average. For plan years be- ginning in 2008 through 2011, the appli- cable interest rates are the monthly spot segment rates blended with the applicable rate under § 417(e)(3)(A)(ii)(II) as in ef- fect for plan years beginning in 2007. No- tice 2007–81 provides guidelines for de- termining the minimum present value seg- ment rates. Pursuant to that notice, the minimum present value transitional seg- ment rates determined for April 2010, tak- ing into account theApril 2010 30-year Treasury rate of 4.69 stated above, are as follows: For Plan Years Beginning in First Segment Second Segment Third Segment 20093.73 5.055.40 20103.26 5.245.76 DRAFTING INFORMATION The principal author of this notice is Tony Montanaro of the Employee Plans, Tax Exempt and Government Entities Di- vision. Mr. Montanaro may be e-mailed at RetirementPlanQuestions@irs.gov. May 24, 20106942010–21 I.R.B. Table I Monthly Yield Curve for April 2010 Derived from April 2010 Data Maturity YieldMaturity YieldMaturity YieldMaturity YieldMaturity Yield 0.5 0.80 20.5 6.24 40.5 6.49 60.5 6.59 80.5 6.63 1.01.1021.0 6.25 41.0 6.50 61.06.5981.06.63 1.51.4221.56.2641.56.5061.56.5981.56.63 2.01.7622.06.2742.0 6.50 62.06.5982.06.63 2.5 2.12 22.5 6.28 42.56.5162.5 6.59 82.5 6.64 3.0 2.49 23.0 6.29 43.0 6.51 63.06.5983.06.64 3.52.8523.5 6.30 43.56.5163.5 6.59 83.5 6.64 4.0 3.19 24.06.3144.0 6.52 64.06.6084.06.64 4.53.5024.56.3244.56.5264.56.6084.56.64 5.0 3.79 25.0 6.32 45.06.5265.0 6.60 85.0 6.64 5.54.0525.5 6.33 45.56.5265.5 6.60 85.5 6.64 6.04.2826.06.3446.0 6.53 66.06.6086.06.64 6.5 4.48 26.56.3546.56.5366.5 6.60 86.5 6.64 7.04.6727.06.3647.0 6.53 67.06.6087.06.64 7.54.8427.56.3647.56.5367.56.6087.56.64 8.04.9928.06.3748.0 6.54 68.06.6188.06.64 8.55.1228.5 6.38 48.56.5468.5 6.61 88.5 6.64 9.0 5.24 29.0 6.38 49.0 6.54 69.0 6.61 89.0 6.65 9.5 5.35 29.5 6.39 49.5 6.54 69.56.6189.5 6.65 10.0 5.45 30.06.40 50.06.55 70.06.61 90.0 6.65 10.55.5430.56.4050.56.5570.56.6190.56.65 11.0 5.62 31.06.41 51.06.55 71.06.6191.0 6.65 11.5 5.69 31.5 6.41 51.56.5571.5 6.6191.5 6.65 12.0 5.75 32.06.42 52.06.55 72.06.62 92.0 6.65 12.55.8132.5 6.42 52.56.5672.5 6.6292.5 6.65 13.0 5.86 33.06.43 53.06.56 73.06.62 93.0 6.65 13.55.9133.56.4453.56.5673.56.6293.56.65 14.05.9534.06.44 54.06.56 74.06.6294.0 6.65 14.5 5.99 34.56.4554.56.5674.5 6.6294.5 6.65 15.0 6.02 35.06.4555.06.5775.0 6.6295.0 6.65 15.56.0535.56.4555.56.5775.5 6.6295.5 6.65 16.06.0836.06.46 56.06.57 76.06.62 96.0 6.65 16.56.1036.56.4656.56.5776.56.6296.56.65 17.06.1237.06.47 57.06.57 77.06.6397.06.66 17.5 6.14 37.5 6.47 57.56.5877.5 6.6397.56.66 18.06.1638.06.48 58.06.58 78.06.63 98.0 6.66 18.5 6.18 38.5 6.48 58.56.5878.5 6.6398.56.66 19.0 6.20 39.0 6.4859.0 6.58 79.0 6.63 99.0 6.66 19.56.2139.5 6.49 59.56.5879.56.6399.56.66 20.06.2240.06.4960.0 6.58 80.06.63100.06.66 2010–21 I.R.B.695May 24, 2010 Part IV. Items o fGeneralInterest Foundations S tatus of Certain Organization s Announcement 2010–36 The following organizations have failed to establish o r have been unable to main- tain their st atus as public charities or as op- erating foun dations. Accordingly, grantors and contribu tors may not, after this date, rely on previ ous rulings or designations in the Cumul ative List of Organizations (Publicati on 78), or on the presumption arising fro m the filing of notices under sec- tion 508(b) of the Code. This listing does notindica te that the organizations have lost their stat us as organizations described in section 50 1(c)(3), eligible to receive de- ductible c ontributions. Former Pub lic Charities. The follow- ing organi zations (which have been treated as organi zations that are not private foun- dations d escribed in section 509(a) of the Code) are now classified as private foun- dations: ABC Music , Jonesborough, TN Access He alth Services, Redford, MI After Tha t, Inc., Lehigh Acres, FL Ann Jean C ommunity Service, Inc., Culver Ci ty, CA Atlantic Coast Junior Golf Association, Myrtle Be ach, SC Barbara’ s Touch of Love Daycare and Learning Center, Greenwood, MS Changing Minds, Inc., New Orleans, LA Communit y Care Instructional Academy, Catalpa, CA Fair Have n Rehab Corporation, New Haven ,CT Friends o f Ujima, Inc., Mount Vernon, NY Godschil Resurrecting Senior Citizen Ministri es, Jamaica, NY Healing H eart Ministries, Inc., Benson, N C Home, Aus tin, TX Horse Mou ntain R & R, Inc., Rayville, MO Institut e for Human Development, Canton, M I Just Beca use Foundation, Smithtown, NY Koblah Fou ndation, Inc., Brookeville, MD Lighthous e Community Development Corporat ion, Little Rock, AR Moriah Min istry, Appleton, WI Mount Mori ah Missionary Baptist Church WRS, Aberd een, MS National Asso ciation of Preventive Kidney Care an d Counseling, Inc., Annapolis, MD Prevailing Wi nds Group Home Corporation, Oakley, CA Primary Care S olutions Community Based Program s, Charlotte, NC Princess Thea ter Foundation, Harriman, TN Professional Providers Training Institute, Perris, CA Redeemer Barn abas Community Center, Inc., Downey, CA Redemption Mi nistries,Arvin,CA Shabach Minis tries Help-Outreach, Long Beach, CA Smith Airfiel d Forever, Inc., Fort Wayne, IN Solano Stingr ays Baseball Club, Vacaville, CA Sudan Family E ducation and Enrichment Center, Wood bury, MN Tarrant Net, F ort Worth, TX Teen Nubi, Inc ., Fairburn, GA True Love Yout h and Community Empowerment I nc., Lithonia, GA Worship and Pr aise Child Development Center, Rich mond, VA YASU, Reading ,PA Yoshida Young ’s Youth Foundation, Gardena, CA If an organiza tion listed above submits information that warrants the renewal of its classifi cation as a public charity or as a private ope rating foundation, the Inter- nal Revenue S ervice will issue a ruling or determinati on letter with the revised clas- sification as to foundation status. Grantors and contrib utors may thereafter rely upon such ruling or determination letter as pro- videdinsec tion 1.509(a)–7 of the Income Tax Regula tions. It is not the practice of the Servic e to announce such revised clas- sificatio n of foundation status in the Inter- nal Revenu e Bulletin. AJCA Modifica tions to the Section 6011 R egulations; Correction Announcement 2010–38 AGENCY: Internal Revenue Service (IRS), Treasury. ACTION: Correction to final regulations. SUMMARY: This document contains a correction to final regulations (T.D. 9350, 2007–2 C.B. 607) which were published in theFederal Registeron Friday, August 3, 2007 (72 FR 43146) that modify the rules relating to the disclosure of reportable transactions under section 6011. DATES: This correction is effective on May 11, 2010, and is applicable on August 3, 2007. FOR FURTHER INFORMATION CONTACT: Charles D. Wien or Michael H. Beker, (202) 622–3070 (not a toll-free number). SUPPLEMENTARY INFORMATION: Background The final regulations (T.D. 9350) that are the subject of this document are under section 6011 of the Internal Revenue Code. Need for Correction As published, the final regulations (T.D. 9350) contain an error that may prove to be misleading and is in need of clarification. Correction of Publication Accordingl y, the publication of the fi- nal regulat ions (T.D. 9350) which were the subject of F R Doc. 07–3786, is corrected as follows : On page 4314 6, column 2, in the preamble, under the caption heading “FOR FURTH ER INFORMATION CON- TACT:”, th e language “Charles D. Wien, Michael H. Beker, or Tolsun N. Waddle, 202–622–3 070 (not a toll-free number).” is remove d and replaced with the language “Charles D. Wien or Michael H. Beker, 202–622– 3070 (not a toll-free number).”. May 24, 20106962010–21 I.R.B. LaNita Van Dyke, Chief, Publications and Regulations Branch, Legal Processing Division, Associate Chief Counsel (Procedure and Administration). (Filed by the Office of the Federal Register on May 10, 2010, 8:45 a.m., and published in the issue of the Federal Register for May 11, 2010, 75 F.R. 26061) 2010–21 I.R.B.697May 24, 2010 Definition of Terms Revenue rulings and revenue procedures (hereinafter referred to as “rulings”) that have an effect on previous rulings use the following defined terms to describe the ef- fect: Amplifieddescribes a situation where no change is being made in a prior pub- lished position, but the prior position is be- ingextendedtoapplytoavariationofthe fact situation set forth therein. Thus, if an earlier ruling held that a principle ap- plied to A, and the new ruling holds that the same principle also applies to B, the earlier ruling is amplified. (Compare withmodi- fied,below). Clarifiedis used in those instances where the language in a prior ruling is be- ing made clear because the language has caused, or may cause, some confusion. It is not used where a position in a prior ruling is being changed. Distinguisheddescribes a situation where a ruling mentions a previously pub- lished ruling and points out an essential difference between them. Modifiedis used where the substance of a previously published position is being changed. Thus, if a prior ruling held that a principle applied to A but not to B, and the new ruling holds that it applies to both A and B, the prior ruling is modified because it corrects a published position. (Compare withamplifiedandclarified, above). Obsoleteddescribes a previously pub- lished ruling that is not considered deter- minative with respect to future transac- tions. This term is most commonly used in a ruling that lists previously published rul- ings that are obsoleted because of changes in laws or regulations. A ruling may also be obsoleted because the substance has been included in regulations subsequently adopted. Revokeddescribes situations where the position in the previously published ruling is not correct and the correct position is beingstatedinanewruling. Supersededdescribes a situation where the new ruling does nothing more than re- state the substance and situation of a previ- ously published ruling (or rulings). Thus, the term is used to republish under the 1986 Code and regulations the same po- sition published under the 1939 Code and regulations. The term is also used when it is desired to republish in a single rul- ing a series of situations, names, etc., that were previously published over a period of time in separate rulings. If the new rul- ing does more than restate the substance of a prior ruling, a combination of terms is used. For example,modifiedandsu- persededdescribes a situation where the substance of a previously published ruling is being changed in part and is continued without change in part and it is desired to restate the valid portion of the previously published ruling in a new ruling that is self contained. In this case, the previously pub- lished ruling is first modified and then, as modified, is superseded. Supplementedis used in situations in which a list, such as a list of the names of countries, is published in a ruling and that list is expanded by adding further names in subsequent rulings. After the original rul- ing has been supplemented several times, a new ruling may be published that includes the list in the original ruling and the ad- ditions, and supersedes all prior rulings in the series. Suspendedis used in rare situations to show that the previous published rulings will not be applied pending some future action such as the issuance of new or amended regulations, the outcome of cases in litigation, or the outcome of a Service study. Abbreviations The fol lowing abbreviations in current use and for merly used will appear in material publis hedintheBulletin. A—Individual. Acq.—A cquiescence. B—Individual. BE—Beneficiary. BK—Bank . B.T.A.—Board of Tax Appeals. C—Individual. C.B.—Cu mulative Bulletin. CFR—Code of Federal Regulations. CI—City. COOP—Coo perative. Ct.D.—Court Decision. CY—County. D—Decede nt. DC—Dummy Corporation. DE—Donee. Del. Order —Delegation Order. DISC—Domestic International Sales Corporation. DR—Donor. E—Estate. EE—Employee. E.O.—Executive Order. ER—Emp loyer. ERISA—Employee Retirement Income Security Act. EX—Executor. F—Fiduc iary. FC—Foreign Country. FICA—Federal Insurance Contributions Act. FISC—Fo reign International Sales Company. FPH—Foreign Personal Holding Company. F.R.—Federal Register. FUTA—Fed eral Unemployment Tax Act. FX—Foreign corporation. G.C.M.—Chief Counsel’s Memorandum. GE—Grante e. GP—General Partner. GR—Grantor. IC—Insura nce Company. I.R.B.—Internal Revenue Bulletin. LE—Lessee. LP—Limited Partner. LR—Lessor. M—Minor. Nonacq.—No nacquiescence. O—Organization. P—Parent Corporation. PHC—Persona l Holding Company. PO—Possession of the U.S. PR—Partner. PRS—Pa rtnership. PTE—Prohibited Transaction Exemption. Pub. L.—Public Law. REIT—Re al Estate Investment Trust. Rev. Proc.—Revenue Procedure. Rev. Rul.—Revenue Ruling. S—Subsi diary. S.P.R.—Statement of Procedural Rules. Stat.—Statutes at Large. T—Target Corporation. T.C.—Tax Court. T.D.—Treasury Decision. TFE—Trans feree. TFR—Transferor. T.I.R.—Technical Information Release. TP—Taxpay er. TR—Trust. TT—Trustee. U.S.C.—Uni ted States Code. X—Corporation. Y—Corporation. Z—Corporat ion. May 24, 2010i2010–21 I.R.B. Numerical Finding List 1 Bulletins 2010–1 through 2010–21 Announcements: 2010-1, 2010-4 I.R.B.333 2010-2, 2010-2 I.R.B.271 2010-3, 2010-4 I.R.B.333 2010-4, 2010-5 I.R.B.384 2010-5, 2010-6 I.R.B.402 2010-6, 2010-6 I.R.B.402 2010-7, 2010-6 I.R.B.403 2010-8, 2010-7 I.R.B.408 2010-9, 2010-7 I.R.B.408 2010-10, 2010-7 I.R.B.410 2010-11, 2010-10 I.R.B.438 2010-12, 2010-7 I.R.B.410 2010-13, 2010-8 I.R.B.426 2010-14, 2010-11 I.R.B.449 2010-15, 2010-10 I.R.B.438 2010-16, 2010-11 I.R.B.450 2010-17, 2010-13 I.R.B.515 2010-18, 2010-12 I.R.B.460 2010-19, 2010-14 I.R.B.529 2010-20, 2010-15 I.R.B.551 2010-21, 2010-15 I.R.B.551 2010-22, 2010-16 I.R.B.602 2010-23, 2010-16 I.R.B.602 2010-24, 2010-15 I.R.B.587 2010-25, 2010-15 I.R.B.588 2010-26, 2010-16 I.R.B.604 2010-27, 2010-18 I.R.B.657 2010-28, 2010-17 I.R.B.616 2010-29, 2010-17 I.R.B.616 2010-30, 2010-19 I.R.B.668 2010-31, 2010-19 I.R.B.681 2010-32, 2010-19 I.R.B.681 2010-33, 2010-18 I.R.B.658 2010-34, 2010-20 I.R.B.685 2010-35, 2010-20 I.R.B.685 2010-36, 2010-21 I.R.B.696 2010-37, 2010-20 I.R.B.685 2010-38, 2010-21 I.R.B.696 Notices: 2010-1, 2010-2 I.R.B.251 2010-2, 2010-2 I.R.B.251 2010-3, 2010-2 I.R.B.253 2010-4, 2010-2 I.R.B.253 2010-5, 2010-2 I.R.B.256 2010-6, 2010-3 I.R.B.275 2010-7, 2010-3 I.R.B.296 2010-8, 2010-3 I.R.B.297 2010-9, 2010-3 I.R.B.298 2010-10, 2010-3 I.R.B.299 2010-11, 2010-4 I.R.B.326 Notices— Continued: 2010-12, 2010-4 I.R.B.326 2010-13, 2010-4 I.R.B.327 2010-14, 2010-5 I.R.B.344 2010-15, 2010-6 I.R.B.390 2010-16, 2010-6 I.R.B.396 2010-17, 2010-14 I.R.B.519 2010-18, 2010-14 I.R.B.525 2010-19, 2010-7 I.R.B.404 2010-20, 2010-8 I.R.B.422 2010-21, 2010-12 I.R.B.451 2010-22, 2010-10 I.R.B.435 2010-23, 2010-11 I.R.B.441 2010-24, 2010-12 I.R.B.452 2010-25, 2010-14 I.R.B.527 2010-26, 2010-14 I.R.B.527 2010-27, 2010-15 I.R.B.531 2010-28, 2010-15 I.R.B.541 2010-29, 2010-15 I.R.B.547 2010-30, 2010-18 I.R.B.650 2010-31, 2010-16 I.R.B.594 2010-32, 2010-16 I.R.B.594 2010-33, 2010-17 I.R.B.609 2010-34, 2010-17 I.R.B.612 2010-35, 2010-19 I.R.B.660 2010-36, 2010-17 I.R.B.612 2010-37, 2010-18 I.R.B.654 2010-38, 2010-20 I.R.B.682 2010-40, 2010-21 I.R.B.693 Proposed Regulations: REG-132232-08, 2010-6 I.R.B.401 REG-134235-08, 2010-16 I.R.B.596 REG-137036-08, 2010-6 I.R.B.398 REG-101896-09, 2010-5 I.R.B.347 REG-117501-09, 2010-11 I.R.B.442 REG-131028-09, 2010-4 I.R.B.332 REG-148681-09, 2010-11 I.R.B.443 Revenue Procedures: 2010-1, 2010-1 I.R.B.1 2010-2, 2010-1 I.R.B.90 2010-3, 2010-1 I.R.B.110 2010-4, 2010-1 I.R.B.122 2010-5, 2010-1 I.R.B.165 2010-6, 2010-1 I.R.B.193 2010-7, 2010-1 I.R.B.231 2010-8, 2010-1 I.R.B.234 2010-9, 2010-2 I.R.B.258 2010-10, 2010-3 I.R.B.300 2010-11, 2010-2 I.R.B.269 2010-12, 2010-3 I.R.B.302 2010-13, 2010-4 I.R.B.329 2010-14, 2010-12 I.R.B.456 2010-15, 2010-7 I.R.B.404 2010-16, 2010-19 I.R.B.664 Revenue Procedures— Continued: 2010-17, 2010-8 I.R.B.425 2010-18, 2010-9 I.R.B.427 2010-19, 2010-13 I.R.B.469 2010-20, 2010-14 I.R.B.528 2010-21, 2010-13 I.R.B.473 Revenue Rulings: 2010-1, 2010-2 I.R.B.248 2010-2, 2010-3 I.R.B.272 2010-3, 2010-3 I.R.B.272 2010-4, 2010-4 I.R.B.309 2010-5, 2010-4 I.R.B.312 2010-6, 2010-6 I.R.B.387 2010-7, 2010-8 I.R.B.417 2010-8, 2010-10 I.R.B.432 2010-9, 2010-13 I.R.B.461 2010-10, 2010-13 I.R.B.461 2010-11, 2010-14 I.R.B.516 2010-12, 2010-18 I.R.B.617 2010-13, 2010-21 I.R.B.691 Tax Conventions: 2010-2, 2010-2 I.R.B.271 2010-26, 2010-16 I.R.B.604 2010-27, 2010-18 I.R.B.657 Treasury Decisions: 9474, 2010-4 I.R.B.322 9475, 2010-4 I.R.B.304 9476, 2010-5 I.R.B.336 9477, 2010-6 I.R.B.385 9478, 2010-4 I.R.B.315 9479, 2010-18 I.R.B.618 9480, 2010-11 I.R.B.439 9481, 2010-17 I.R.B.605 1 A cumulative list of all revenue rulings, revenue procedures, Treasury decisions, etc., published in Internal Revenue Bulletins 2009–27 through 2009–52 is in Internal Revenue Bulletin 2009–52, dated December 28, 2009. 2010–21 I.R.B.iiMay 24, 2010 Finding List of Current Actions on Previously Published Items 1 Bulletins 2010–1 through 2010–21 Announcements: 2009-23 Corrected by Ann. 2010-29, 2010-17 I.R.B.616 2009-51 Supplemented and superseded by Ann. 2010-16, 2010-11 I.R.B.450 2010-4 Corrected by Ann. 2010-10, 2010-7 I.R.B.410 2010-22 Corrected by Ann. 2010-34, 2010-20 I.R.B.685 Notices: 2005-88 Superseded by Notice 2010-13, 2010-4 I.R.B.327 2006-87 Superseded by Notice 2010-27, 2010-15 I.R.B.531 2007-25 Superseded by Notice 2010-27, 2010-15 I.R.B.531 2007-77 Superseded by Notice 2010-27, 2010-15 I.R.B.531 2008-14 Modified and superseded by Notice 2010-33, 2010-17 I.R.B.609 2008-41 Modified by Notice 2010-7, 2010-3 I.R.B.296 2008-55 Modified by Notice 2010-3, 2010-2 I.R.B.253 2008-88 Modified by Notice 2010-7, 2010-3 I.R.B.296 2008-107 Superseded by Notice 2010-27, 2010-15 I.R.B.531 2008-113 Modified by Notice 2010-6, 2010-3 I.R.B.275 Notices— Continued: 2008-115 Modified by Notice 2010-6, 2010-3 I.R.B.275 2008-116 Modified and superseded by Notice 2010-32, 2010-16 I.R.B.594 2009-11 Amplified by Notice 2010-9, 2010-3 I.R.B.298 2009-13 Obsoleted by T.D. 9478, 2010-4 I.R.B.315 REG-131028-09, 2010-4 I.R.B.332 2009-35 Supplemented by Notice 2010-17, 2010-14 I.R.B.519 2009-38 Amplified and superseded by Notice 2010-2, 2010-2 I.R.B.251 2009-62 Modified and supplemented by Notice 2010-23, 2010-11 I.R.B.441 Proposed Regulations: REG-127270-06 Hearing scheduled by Ann. 2010-6, 2010-6 I.R.B.402 REG-134235-08 Hearing scheduled by Ann. 2010-33, 2010-18 I.R.B.658 Revenue Procedures: 80-59 Modified and superseded by Rev. Proc. 2010-11, 2010-2 I.R.B.269 87-35 Obsoleted by Rev. Proc. 2010-3, 2010-1 I.R.B.110 2001-18 Superseded by Rev. Proc. 2010-16, 2010-19 I.R.B.664 2008-14 Updated by Rev. Proc. 2010-15, 2010-7 I.R.B.404 2009-1 Superseded by Rev. Proc. 2010-1, 2010-1 I.R.B.1 2009-2 Superseded by Rev. Proc. 2010-2, 2010-1 I.R.B.90 Revenue Procedures— Continued: 2009-3 Superseded by Rev. Proc. 2010-3, 2010-1 I.R.B.110 2009-4 Superseded by Rev. Proc. 2010-4, 2010-1 I.R.B.122 2009-5 Superseded by Rev. Proc. 2010-5, 2010-1 I.R.B.165 2009-6 Superseded by Rev. Proc. 2010-6, 2010-1 I.R.B.193 2009-7 Superseded by Rev. Proc. 2010-7, 2010-1 I.R.B.231 2009-8 Superseded by Rev. Proc. 2010-8, 2010-1 I.R.B.234 2009-9 Superseded by Rev. Proc. 2010-9, 2010-2 I.R.B.258 2009-15 Amplified and superseded by Rev. Proc. 2010-12, 2010-3 I.R.B.302 2009-17 Superseded by Rev. Proc. 2010-21, 2010-13 I.R.B.473 2009-25 Superseded by Rev. Proc. 2010-3, 2010-1 I.R.B.110 2009-55 Corrected by Ann. 2010-11, 2010-10 I.R.B.438 2010-1 Corrected by Ann. 2010-5, 2010-6 I.R.B.402 Revenue Rulings: 67-436 Obsoleted by REG-101896-09, 2010-5 I.R.B.347 92-19 Supplemented in part by Rev. Rul. 2010-7, 2010-8 I.R.B.417 2008-52 Supplemented and superseded by Rev. Rul. 2010-2, 2010-3 I.R.B.272 1 A cumulative list of current actions on previously published items in Internal Revenue Bulletins 2009–27 through 2009–52 is in Internal Revenue Bulletin 2009–52, dated December 28, 2009. May 24, 2010iii2010–21 I.R.B. Treasury Decisions: 9350 Corrected by by Ann. 2010-38, 2010-21 I.R.B.696 9424 Corrected by Ann. 2010-18, 2010-12 I.R.B.460 9443 Corrected by Ann. 2010-8, 2010-7 I.R.B.408 9458 Corrected by Ann. 2010-7, 2010-6 I.R.B.403 2010–21 I.R.B.ivMay 24, 2010 May 24, 20102010–21 I.R.B. INTERNAL REVENUE BULLETIN The Introduction at the beginning of this issue describes the purpose and content of this publication. 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